Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#1
You will be expected to auto-enrol all employees between the ages of 22 and state retirement age, who earn over £9440 per annum into a pension and make contributions yourself to the scheme. They are entitled to opt-out but then you will have to opt them back in 3 years later.
Indeed - if you are thinking ''that does not apply to me because my only employee is 16 (or 74)'' - think again. If they earn between £5668 and £9440 per annum you will have to offer them membership of a scheme and if they say yes you have to pay into it.
Any other employee has a right to ask you to provide a pension for them but for these (very few...) you will not have to contribute.
Also - do not think - ''ah my 17 year old wont want to join a scheme so I do not need to do anything' - sorry - that does not work. You still have to arrange a scheme and register it with the Pensions Regulator and you have to make sure that you provide the right notices at the right time. The scheme then has to be re-registered every 18 months...
Here are some of the penalties if you do not comply:
Fixed Penalty Notice £400 where a breach has been identified in a compiance notice previously issued. There are 4 weeks to put thing right, if not the penalty will be applied.
Escalating Penalty Notice. 1 to 4 people affected £50 per day.
5-49 affected - £500 a day.
It goes right up to £10,000 a day where you have over 500 people affected.
'people affected' could be all your payroll or the number for whom there are unpaid contributions.
There are other penalties too:
Wilful failure to comply fines and up to 2 years in prison
Inducements - if an employer induces someone not to join or opt out there is a 3 stage process.
Employers are not allowed to make any statement or ask a question in the recruitment process to suggest an employee may not join or should opt out of a scheme.
1-4 employees - £1000 fine per person affected
up to £5000 per person affected where 250 or more.
Hundreds of inspectors are being recruit to inspect employers. Up to 6 years after if a breach is found, which could simply be being unable to produce a copy of the right letter and show it was provided to the right person at the right time then you are at risk of a fine.
Since October 2012 large employers have been hitting their staging dates from when they should have a scheme operational. There has already been one company found in breach with others under investigation. In fact 8% of large employers have been issued an 'investigation notice'.
If these large employers, with their resources, are having problems just imagine the problems for small less well resourced employers who will hit their staging dates over the next 2 years....
The regulator is worried.
They are worried that pension companies will not be able to cope with the volumes hitting staging dates.
They are worried that small employers do not realise the urgency to take action.
They are worried that there are too few advisers to help them.
The regulator says that a company needs to start preparation 18 months before the staging date and too few are doing so.
Many if not most insurance companies will not accept to take on schemes where the employer has less than 6 months to go before staging.
In the spring it is estimated that 12,700 employees will be joining schemes every month.
29,000 employers will hit their staging dated over the first 6 months of next year.
There are only 32,600 advisers of all types, many of them not in the group pensions market, to handle this business while also carrying on with their usual workload....
If you employ someone - you need to start preparing right now.
So - if you are thinking of starting a business and employing people for the first time or perhaps expanding your business, then you need your head examined with all this to face.....
Guest 710- Registered: 28 Feb 2011
- Posts: 6,950
#2
What's that Barry, form a co-operative?
Ignorance is bliss, bliss is happiness, I am happy...to draw your attention to the possible connectivity in the foregoing.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
#3
so much for small government!!
Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
#4
eerrrr Tom? what relevance has that to this thread?
Howard - this legislation was to deal with a very real problem and was brought in by the last government based on a scheme in New Zealand that was successful. But this country is very different and a lot larger than NZ!!!
I am rather disappointed that the present government did not reverse the decision and establish a different way forward with retirement planning. Even if just to extend/change the timescales.
We just have to deal with it, but I am convinced that this will produce a lot of problems for small companies and will impact adversely on economic recovery.
Guest 725- Registered: 7 Oct 2011
- Posts: 1,418
#5
What economic recovery? There is none. It's an illusion.
Guest 745- Registered: 27 Mar 2012
- Posts: 3,370
#6
Borrowed and printed money
One day this will all rollover. You know this Barry